Flood insurance rates paid by the  current owner or seller of a property are not likely to be the same rates paid by the new homeowner.

It is important for buyers purchasing real estate in Southwest Florida to know whether the property they are interested in may be located in a high risk flood area.

The best explanation of the changes I have found is this video prepared by Wright Flood narrated by Dolores Glass, Communications Manager.   Understand the Basics of 2012 Flood Reform Laws

The most recent Flood Insurance Update from FEMA has provided guidance to changes of Biggert Waters (BW12) resulting from the Homeowners Affordability Act of 2014 (HFIAA) which was signed by the president on March 21, 2014.

The information below was provided by Andrea Pelletier of Gulf Shore Insurance.  Her direct line is 239-435-7154


When the Homeowner Flood Insurance Affordability Act of 2014 (HFIAA) was passed by Congress, it gave relief to those older Pre-firm homes that faced thousands in premium increases. To compensate for the decrease in revenue, the new law calls for Flood insurance rates and other charges be revised for new or existing policies beginning on 4/1/15. In addition to insurance rates, other changes resulting from Biggert-Waters and HFIAA will be implemented that will affect the total amount a policyholder pays for a flood policy. Highlights of some of those changes follow.

Probably the most profound impact will be on those policies where the home is not considered a “Primary Residence”. To be a primary residence, the home must be occupied a minimum of 51% of the year. Documentation will be required to prove this. Primary homes will see a new $25 surcharge on their renewal policies. Non-primary homes, even those in the preferred X zones will be hit with a $250 annual surcharge. Every existing flood policyholder will receive a letter prior to the renewal asking for the occupancy so that the correct surcharge is added.

In addition to the new surcharges, most premiums will see an overall increase capped at 15%. Add in the occupancy surcharge, a higher Reserve Fund Assessment, and new higher Policy Fees and this will result in a total 18% – 19.9% increase.

Pre-firm homes (built prior to ’74 within the City of Naples; ’79  Collier & Lee County), will see their premiums increase an additional 14% if Primary, 24% if Non-Primary (not including surcharges, assessments, and fees). These increases will continue until the “full rate” is achieved. It is imperative for a homeowner to know what their “full rate” is. An Elevation Certificate will be used to calculate that. We suggest using a more recent one done after the map changes of May 2012.

Another change impacting many is those homes that have recently been taken out of an X zone and put into an A zone. Those homeowners had been offered an “extension” of the Preferred X Zone Policy rates. That program will no longer be available. After 4/1/15, these policyholders will receive, in addition to the new surcharges and overall premium increases, an annual increase of 15% – 18% until the “full rate” is achieved (same as above Pre-firm homes).

A new $10,000 Deductible is available and will apply to both Building and Contents. Mortgage lenders most likely will not allow this high of a deductible.

Minimum deductibles will change from $1,000 to $1,250 for some policyholders.

For more information about Flood Insurance you can visit www.Floodsmart.gov or www.FEMA.gov

Please feel free to call me, Beverly Howe, ABR, GRI, TRC, CIPS, CNE, SRES  Broker/Owner 

Toll Free at 1-800-283-7393 or 1-239-601-2013 anytime for additional information.

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